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TMI Blog1960 (11) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1956, made by the Income-tax Appellate Tribunal, Madras, in Income-tax Appeals Nos. 2358, 2359 and 2360 of 1955-56. M. Kasturi Ranga Setty (hereinafter referred to as K. R. Setty) was a member of a joint Hindu family. On a partition between himself and his two brothers, two flour mills belonging to the family became his separate property from June 1, 1948. These two flour mills were the Krishna Flour Mills and the Elgin Electric Flour Mills, in the latter of which K. R. Setty had only a lessee's interest. He was assessed under the Mysore Income-tax Act as karta of a joint Hindu family until the assessment year 1949-50, that is, before the Indian Income-tax Act, 1922, was brought into force in Mysore on and from April 1, 1950. Even befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e profits and losses, and the business would be conducted by the first partner, namely, K. R. Setty, assisted by the third partner, namely, V. Setty. The firm was duly registered with the Registrar of Firms on November 23, 1949. The appellant made an application under section 26A of the Act for registration of the firm for the assessment year 1950-51 and 1951-52. The Income-tax Officer, Bangalore, rejected the application on March 18, 1954, holding that the partnership was not genuine. That order was confirmed in appeal by the Appellate Assistant Commissioner and the Income-tax Appellate Tribunal. The appellant renewed his application for the assessment years 1952-53, 1953-54 and 1954-55. These applications were heard together, and by an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, but that fact would not make the said question a question of law ". In the result the High Court rejected the applications. The appellant then obtained special leave from this court, in pursuance whereof the present appeals have been preferred. Learned counsel for the appellant has contended before us that an issue of law arises in this case, and he has put his case on the footing that on the facts found by the Tribunal, apart from mere suspicion and surmises, no such inference as has been drawn by the Tribunal reasonably follows ; his argument is that the materials point only one way, and on such facts as the Tribunal has found no person acting judicially and properly instructed as to the relevant law could have come to the finding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d then with his brotherin-law; (4) that the amounts withdrawn in 1952, 1953 and 1954 covered similar expenses as also expenses for improvement of a house which V. Setty had purchased in 1945 ; (5) that the appellant had not furnished full details of how the amounts withdrawn in those years were spent ; (6) the account of Nagaratnamma showed that she had not withdrawn any part of her share of profits, which were separately shown in the account ; and (7) she was an ordinary type of Hindu house-wife. The Tribunal also referred to the circumstances that K. R. Setty had been corresponding with the income-tax authorities on the footing that he was the proprietor of the business even after the commencement of the partnership ; but that corresponde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... easonable and not justified either by partnership law or common human experience. The books of partnership accounts were not held to be false ; nor was it suggested that there were no good reasons for taking the wife and brother-in-law as partners. It was accepted that both of them contributed their share of the capital, and it was not disputed that the brother-in-law managed the business, and at the relevant time lived with K. R. Setty. Learned counsel for the respondent suggested that the sum of Rs. 50,000 which Nagaratnamma contributed might not be her stridhanam in law. It is enough to point out that no such finding was given by the Tribunal; on the contrary, the Tribunal found that she contributed her share of the capital in the manner ..... X X X X Extracts X X X X X X X X Extracts X X X X
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